Protection Deal

by Nathan Hamm on 1/19/2006 · 4 comments

Gazprom’s Alexei Miller is in Uzbekistan trying to negotiate a deal that would give the company control over the exports of gas from the country. In exchange, Kommersant reports, Uzbekistan wants a guarantee of Moscow’s protection.

But those promises were not enough for the Uzbek authorities. Therefore, as Kommersant has learned, the Uzbek authorities have developed a project to set up international antirevolutionary punitive forces in the former Soviet Union, for which a military alliance such as the CSTO could become an umbrella organization. Thus, Uzbekistan will enter the CSTO with a package of proposals to improve the organization, including proposals to set up intelligence and counterintelligence bodies within it and to develop ways for it to guarantee the domestic security of the Central Asian states.

Russia is leery of giving the organization a policing role so far. Its ambition is to make it the Eurasian answer to NATO and not a watchdog for the Central Asian states. But Moscow’s position may change as the St. Petersburg summit nears. As Tashkent has already understood, the way to the Kremlin’s heart is through Gazprom.

I’m sure Uzbekistan would absolutely love to secure a deal from Russia to be protected from all threats internal and external. Something makes me slightly skeptical of this story though. I agree that Russia would avoid making the CSTO into a guarantor of all members’ governments. But I doubt that Uzbekistan’s bargaining position is so strong as to make Russia seriously consider making such a deal.

The Kommersant report is making its way into other reports on the negotiation, but no one else has any independent verification.

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Nathan is the founder and Principal Analyst for Registan, which he launched in 2003. He was a Peace Corps Volunteer in Uzbekistan 2000-2001 and received his MA in Central Asian Studies from the University of Washington in 2007. Since 2007, he has worked full-time as an analyst, consulting with private and government clients on Central Asian affairs, specializing in how socio-cultural and political factors shape risks and opportunities and how organizations can adjust their strategic and operational plans to account for these variables. More information on Registan's services can be found here, and Nathan can be contacted via Twitter or email.

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Rustam January 20, 2006 at 6:16 am

It is sad, appalling for an Uzbek. All these years my country have been living under Karimov’s stupid principles of economic reforms – the most important of which was the principle of gradual and evolutionary transformation to market economy as opposed to shock therapy. I always disagreed with the idea and knew that it will bring to this. That Karimov always argued and always kept on saying that what Nazarbayev is doing is temporary solution to economic hardship in Kazakhstan, that they will not achieve lasting economic development, where as he was establishing fundamental sectors of the economy, attracting foreign investments to oil and gas sectors. After 15 years what we are left with is the bankrupt UzbekNeftGas and the fact that Karimov is selling gas reserves for cheap, have not been able even to organize a decent tender among 5-6 top oil and gas companies of the world. I would rather see Shell or Chevron then state owned Gazprom, because it is not transparent and will not bring anything new in terms of corporate culture to Uzbekistan.

Brian January 20, 2006 at 9:36 am

Forgive my ignornace on this subject, but Russia has been in the headlines lately for both its import AND export of gas. So what’s the deal, is Russia a net importer or exporter of natual gas?

If they’re a net exporter, then do they need Uzbek and Turkmen gas to supply parts of their country that aren’t connected to the domestic pipeline grid?

Or is Russia just re-selling imported natual gas and collecting transit fees?

Matt W January 22, 2006 at 3:27 am

Russia is just selling imported natural gas and collecting transit fees. It has the world’s largest natural gas reserves by far, mostly in Siberia. There have been attempts to pipe natural gas out of the CA region without going through Russia (the Uncoal Afghanistan pipe, a Turkmen pipe under the Caspian, an expanded pipeline via Iran), but, save a small amount of Turkmen gas that goes through Iran, no alternative natural gas pipelines have been built. I know awhile back the Turkmen were trying to sell gas to Turkey via Iran, but I never checked up on what became of this.

Brian January 22, 2006 at 2:24 pm

I understand Russa has vast reserves, but I wasn’t sure that their current gas production was sufficient. In any case, if they’re just collecting transit fees, then you’d think that Russia certainly has the upper hand in bargaining with Tashkent and Ashgabat than the central asian states do. No doubt Uzbekistan and Turkmenistan needs the gas money a LOT more than Russia does.

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